High Output Management is one of the most disappointing books I’ve ever read, and in some places it flat out pissed me off.
I started with high expectation. After all, it was written by the late Andrew S. Grove, former Chairman and CEO of Intel Corp. Grove is credited with transforming the company from a manufacturer of memory chips into the world’s leading producer of CPUs. During his time as CEO, Intel’s revenue grew by 4,500%. He must have been an amazing and inspirational leader.
You’d never know it from reading his book.
High Output Management is Andy Grove’s handbook for managers. I’ll summarize the key points and then give some unsolicited feedback at the end.
The book is organized around three main ideas.
- The focus is always on output. Everyone and every team produces output. A manager’s job is to plan, organize and guide their teams to produce the right quantity and quality of output in the right period of time. Because of this output focus, Grove uses manufacturing as the framework for discussing many management topics.
- In organizations, output is produced primarily by teams rather than individuals. The output of a manager is therefore the combined output of their team. So managers should spend as much of their time as possible on activities that provide leverage, that is, activities which increase the output of their teams.
- Teams function best when they are getting peak performance from every individual. It’s the managers job to get that peak performance through coaching, formal training, feedback and performance appraisal.
The book is divided into sections dealing with each of these ideas.
The Breakfast Factory
Grove uses the simple example of a breakfast factory that turns out soft boiled eggs, buttered toast and coffee to show us how to manage output,. He talks about breaking work down into discrete steps, sequencing and overlapping the steps properly, understanding where bottlenecks can arise, and ensuring there’s enough inventory to meet customer demand.
This section also deals with the importance of metrics, which Grove calls indicators, Grove discusses leading indicators which can tell you what’s likely to happen inside the “black box” of your operation, and trend indicators which measure performance over time.
Quality assurance is one of the key aspects of managing any production process, and here Grove recommends monitoring quality at three stages; input material inspection, in-process inspection, and final inspection. Inspections can either be done by gating where all material is held up until it either passes or fails inspection, or by sampling where material moves continuously through the process and random samples are taken to measure quality. The goal is to identify flaws as early in the precess as possible.
Even if you don’t work in a manufacturing setting, it’s pretty easy to apply this to your own work. In my case, I work with a team that produces mathematical models using machine learning. We need to be concerned about the quality of our input data, whether the modeling process is running correctly, and whether the final models perform satisfactorily.
Next Grove covers techniques for managing teams. He stresses that a manager’s most valuable resource is their own time. They should spend as much of their time as possible on leveraged activities; activities that either impact a group of people, or impact a single individual over a long period of time.
Grove also tackles decision-making in this section, He lays out a model for decision-making that has three main elements:
- Decisions should be made at the lowest competent level in the organization — a principle known as subsidiarity.
- Everyone should know their role in the decision-making process. Who formally makes the decision, who contributes information, who gets informed afterwards? There are various ways to organize this and they go by cryptic acronyms like RAPID, OARP and RACI,.
- Finally, once debate is over and a decision is made, everyone must commit to successful execution. This is known these days as “disagree and commit.”
The section concludes with a chapter on planning. How do you identify and organize the actions and the resources needed to move from the present state to a desired future state? This is where Grove discusses objectives and key results (OKRs), but although Grove has been called the “father of OKRs” they’re really just a small part of the book. Objectives identify where you’re trying to go or what you’re trying to achieve. Key results are the milestones you use to measure progress.
The final section of the book is about what managers should do to obtain peak performance from the people on their team. Performance is a combination of motivation and capability, Grove says.
To understand what motivates people, Grove uses Maslow’s hierarchy of needs. But in the end he recommends using competition to motivate your team. Getting people to compete against other teams in the same organization, or against real industry competitors can help motivate exceptional effort and performance, he says.
“Turning the workplace into a playing field can turn our subordinates into “athletes” dedicated to performing at the limit of their capabilities — the key to making our team consistent winners.” [p. 171]
On the subject of capabilities, Grove walks us through the details of training, giving feedback and performance reviews.
This all seems pretty reasonable, right? So what’s so disappointing and annoying?
To be fair, Andy Grove wrote High Output Management back in 1983 and our views about management and organizations have evolved considerably since then. And maybe his ideas have spread so widely, especially in the tech sector where I work, that they no longer seem fresh. They’re just part of the atmosphere we breathe in many organizations.
The book does contain a lot of useful nitty-gritty details, tips and tricks for stuff like managing your work, your team, and your calendar, for running meetings, for sizing your team, for handling performance reviews, etc. And the writing is clear and concise enough.
But this is Andy Grove! I expected something … more. Deeper, more insightful, more sophisticated. More.
Instead he serves up a breakfast factory. And a sports team analogy. Really?
What disappointed me most was the total absence of any discussion of managing research and development work which is inherently more creative, less structured and less predictable than manufacturing. Yes, some of the principles of manufacturing can be applied to R&D activities, but they have their own unique characteristics and challenges. Intel does a huge amount of R&D so why Grove ignored this part of his company and his own experience is beyond me.
But I think it’s his approach to dealing with people that kills this book for me. Too much of the book seems to be written under the assumption that team members are fungible assets and not human beings with individual needs and specialized skills. I found the chapter on motivation to be especially weak, At one point he says,
“Fear won’t work as well with computer architects as with galley slaves; hence, new approaches to motivation are needed. [p. 159]
Yeah, it was so much easier back in Roman times. Later, after introducing Maslow’s hierarchy, he says,
“Simply put, if we are to create and maintain a high degree of motivations, we must keep some needs unsatisfied at all times.” [p.159]
Let’s keep everyone just a little bit hungry. How enlightened!
I’ve never managed a large team, let alone an organization of hundreds or thousands of people, but I’m sure we can do better than that.
What about creating an environment in which people can grow, flourish and fulfill their needs in a way that also helps the organization achieve its goals?
You won’t find anything like that in High Output Management.
If you’ve never read anything about management or leadership, there are better books. And if you’re looking to dive deeper into specific management topics, there are better books. Here are some that I’ve read recently:
- Radical Candor by Kim Scott (review) is aimed at helping you be a better boss. It provides simple, nuts-and-bolts advice for giving guidance, building teams and getting results.
- Principles by Ray Dalio (review) is mostly about personal development. It’s a hierarchically organized set of a couple of hundred heuristics refined over Dalio’s forty year career that are designed to help you get the most out of your life and work.
- Crucial Conversations by Kerry Patterson, Joseph Grenny, Ron McMillan and Al Switzler (review) is about how to hold high-stakes, emotionally-loaded conversations where opinions differ. Performance reviews, giving tough feedback, a frank talk with your mother — those sorts of conversations.
- Dare to Lead by Brené Brown (review). Leadership requires courage, and courage requires vulnerability. Dare to Lead helps you develop the courage to lead in the full knowledge and acceptance of our own vulnerability.
They overlap quite a bit, so you don’t need to read them all, but they each have something unique to offer.
Ted Talk: Why the secret to success is setting the right goals by John Doerr who worked with Andy Grove at Intel and later convinced Google’s founders to adopt OKRs.